7 Best-Performing Small-Cap ETFs for April 2025
Small-cap ETFs can be a refreshing addition to your investment portfolio, but they do come with some risk. Here's a list of the best-performing small cap ETFs this month.
Many, or all, of the products featured on this page are from our advertising partners who compensate us when you take certain actions on our website or click to take an action on their website. However, this does not influence our evaluations. Our opinions are our own. Here is a list of our partners and here's how we make money.
The investing information provided on this page is for educational purposes only. NerdWallet, Inc. does not offer advisory or brokerage services, nor does it recommend or advise investors to buy or sell particular stocks, securities or other investments.
As the Federal Reserve has prepared to cut rates, some investors have shifted their focus toward small-cap stocks — small companies, such as those of the Russell 2000 index, that often depend on borrowed money to stay afloat.
If you’re looking to add smaller companies to your investment portfolio, small-cap ETFs make it easy to invest in lots of small-cap companies at once.
What is a small-cap ETF?
A small-cap ETF is a type of exchange-traded fund that invests in companies whose value is less than $2 billion. And while $2 billion may sound like a lot, these companies are relatively tiny compared with mid-cap, or even large-cap companies, which start at $10 billion. So if you invest in a small-cap ETF, you’re essentially investing in a collection of small companies in a single investment.
Best-performing small-cap ETFs
The ETFs below are small-cap growth ETFs. These funds invest in companies that are predicted to increase in price faster than other small-cap stocks.
Ticker | Company | Performance (Year) |
|---|---|---|
SGDJ | Sprott Junior Gold Miners ETF | 31.61% |
ECNS | iShares MSCI China Small-Cap ETF | 16.25% |
SMLV | SPDR SSGA US Small Cap Low Volatility Index ETF | 14.21% |
SMMV | iShares MSCI USA Small-Cap Min Vol Factor ETF | 13.80% |
PSCF | Invesco S&P SmallCap Financials ETF | 12.92% |
PSCU | Invesco S&P SmallCap Utilities & Communication Services ETF | 12.68% |
FYC | First Trust Small Cap Growth AlphaDEX Fund | 10.20% |
Source: Finviz. Data is current as of 2025-04-03 and is intended for informational purposes only. | ||
Why invest in small-cap ETFs?
One reason small-cap ETFs may be attractive to investors is that they provide further diversification to a portfolio that has exposure to large or medium-sized companies. Some investors believe in what’s called the “small-cap effect,” a theory that smaller companies have more room to grow than larger companies — and thus have more potential for a bigger return.
Because smaller companies don’t have as much financial wiggle room, they are often riskier than larger companies. But when those single stocks are rolled into an ETF, it can smooth out the overall risk. For example, if one company goes out of business, the other companies in that ETF may help buoy your portfolio.
While it’s impossible to know if investing in smaller companies will definitively lead to a more significant profit, diversifying the companies in your portfolio, even if they are smaller, can help you safeguard against risk.
» Ready to get started? See our roundup of the best online brokers for ETF investing.